Rumor has it that Sony and Microsoft may be blocking the use of used software in their new consoles. This has reinvigorated the debate over used games and will hopefully shed some light on the issue of used games to those who are unaware much like I was only a few years back.

First off, I’m not an economics expert (or even an amateur) and I don’t know what the effect of blocking or allowing used games has on the financial stability of a game developers/publishers. This article will stick primarily to principles and hypotheticals. I’ll come clean and say that I am not a fan of used games but I am giving an honest effort to understand both sides of the argument.

The prospect of changes to the used game market has led to an uproar around the net. An uproar that is understandable as, with all things, people do not like to spend more money on things they are currently getting for cheap.

Possibility #1: Used games are banned from working on any system other than the first.

PROS:

1. Developers/publishers receive the maximum amount for every game sold

For many years I sold and bought used games for the sole reason that it was cheaper. I was oblivious to the fact that by buying used I was preventing any money from going to the people who created that very game. As soon as I learned otherwise I immediately stopped buying used games. Though I’m admittedly half-assing it because I still sell my new games back when I’m done.

By killing the used-game market and forcing gamers to buy new games publishers/developers would expected to see profits rise as they would get a share of every game sold. This is a good thing. Remember not to think of devs and publishers as giant money-hungry corporations but instead of the fine folk whose creativity and hard work give us amazing experiences time after time. I can’t thank them enough but one way I do is making sure they are paid for their fantastic services.

Higher profit margins for creators would likely (hopefully) come full circle and result in better games as teams would have more resources to spend on staff. More people, better people = more polish, better games. And just as an FYI, the average salary for a junior game designer (ie grunt) is about 40-50k so it’s not like the rich are just getting richer.

CONS:

1. Massive personal libraries collecting dust

If you are any kind of console gamer and you still enjoy owning retail versions of games, in a few years you are going to have a giant library of games. One of things I personally enjoy about selling my games back is that I know that it won’t just sit, unplayed in a box somewhere. Returning games saves space and it’s eco-friendly as another copy does not need be produced (Hello downloadable games!) for someone else to enjoy the experience. Some games warrant keeping for nostalgia or multiple play-throughs but many do not. Mass Effect 3 is an unbelievable game. And I will never play it again. It should not be wasted on me because I have no way of passing on to other players. No, this issue doesn’t have anything to do with money but is important none-the-less.

2. Goodbye GameStop

Even though I’m against used gaming overall I still love GameStop. Sadly, I don’t see how GameStop could survive if used games were banned. Don’t quote me but I saw in an article written by someone smarter than me that said approximately 47% of GameStop’s profit comes from the sale of used games. I expected it to be even higher but I’m pretty sure cutting your profit margin in half is tough to recover from. I would be extremely bummed to see GameStops closing.

3. Highest cost to gamers

Easily the biggest negative of this system. Many of my anti-used game friends cite the fact that used games are typically about $55 instead of $60 so why not just support the developers and pay your extra $5. That’s not completely true though is it. Yes, buying the used game is about $5 cheaper but what about the $25 I got for selling back the game I just finished? Simple math deduces that with the current model buying new over used can cost a gamer twice as much. Paying 100% more for something you enjoy is not adjusted to easily and gamers are rightly concerned.

Overall, Possibility #1sucks and I think everyone knows it. Many people think that games are already too expensive (which they aren’t if you compare game prices over the years with inflation, thanks to Colin Moriarty for the econ lesson) so the increase would likely cause gamers to simply buy fewer games. AKA a lose-lose situation for gamers and game creators. I would be very surprised if this model comes to be.

Possibility #2: Used games are still purchasable but gamers must pay to “unlock” the ability to use it on their system.

I think this system is brilliant and thanks to GameTrailer’s Annoyed Gamer from educating me about it.

PROS:

1. Compromise.

Each side (gamers and creators) may not be getting the best solution from their perspective but neither is it the worst. Currently, the used game market is nothing but bad for devs and publishers. If you spend $55 on a used version of Dark Souls at GameStop you just gave $55 to GameStop and $0 to its developer From Software. If you buy Dark Souls new you are still supporting GameStop but they in turn have to buy more new copies to replenish their inventory which is money in From Software’s pocket (or future game budget!). On the other hand, Possibility #1, banning used games outright, is nothing but bad for gamers as they would have to pay up to twice as much for games. Possibility #2 levels the field. It does require gamers to pay more than they now for used games but nowhere near double.

Hypothetical numbers:

$15 – cost to activate a used game

$35 – new cost of a used game to adjust for additional cost of activation

$50 – overall cost to play a used game in your system ($15+$35 = $50)

With a $50 pricetag on used games $15 could go to creators (30%) and $35 goes to GameStop (70%) with the gamer still getting a game for $10 cheaper than new. This would mean that GameStop is still taking a hit to profits but it is not nearly as devastating as banning used games entirely and game creators get more than the 0% they currently see from used game sales.

CONS:

1. Prices still go up for gamers

Looking back to the hypothetical numbers above, GameStop only gets $35 instead of $55 for a used game. They would likely turn that cost back onto the gamers in the form of buying games back for less than they are now. Cost to gamers would still be less than buying a new copy but getting games for 50% cheaper than retail would be unlikely.

Conclusion:

I’m ok paying a little more as long as the money is distributed in such a way that allows profits to be reinvested into future games. I want game developers to make more money and I want games to be polished to a glossy sheen because they have less restrictive budgets. If that means I have to shell out a couple hundred bucks more each year I’ll do my part gladly. I hope the rest of the community will keep an open mind to the changes that may be coming and do their part to make used gaming profitable for everyone.

Best wishes to anyone affected by any industry lay-offs of which are happening all too often these days.

If there are Pros or Cons to either strategy that I missed or you know more about something I have written than I do feel free to correct me in comments. I would like to know more the same as a lot of people.